The Mighty Mississippi!

The Mississippi is the longest river in North America.  The headwater is Lake Itasca in Minnesota and then it travels south for 2,350 miles to reach the Gulf of Mexico near New Orleans.  It’s the fourth largest river in the world.[1]  The watershed for the Mississippi covers about a third of the United States from the Allegheny Mountains to the Rocky Mountains.[2]  The Missouri from the west and the Ohio from the east are two of the largest rivers flowing into the Mississippi.  The Yellowstone, Platte, Arkansas, Chippewa, Wisconsin, Cumberland, and Tennessee rivers also drain into the watershed.

92% of our country’s agriculture travels through the Mississippi basin and 60% of grain exports are shipped from the Port of New Orleans.  The river is also a major source for wildlife.  60% of North American birds use it as a flyway while migrating and 25% of all fish species in North America can be found in the river.[3]  It boarders ten states and its tributaries touch another twenty-one. 18 million people living in 62 major cities rely on the river for daily drinking water.[4]

The Mississippi is a major source for our infrastructure supporting people, commerce and wildlife.  It’s the backbone of our country and it can teach us a few things about financial planning and investing.

  1. A financial plan should be the main source for your investments. It can help you navigate your financial goals and dreams.
  2. Several rivers flow into the Mississippi watershed. They differ in size and can be found in diverse locations across the country.   Your portfolio should own investments across sectors and countries, so you can maintain a diversified portfolio.
  3. The average surface speed of the Mississippi is about 1.2 miles per hour, so it takes three months for water to travel the length of the river.[5] Patience is needed if you were to float it.  It also takes patience to be a successful investor.  It may take months or years for your portfolio to show promise so don’t be discouraged when it’s meandering.
  4. The river can also rage. In 1993 its flood crest was 49.5 feet in St. Louis, a record[6].  The water travelled fast and caused much damage, but it eventually returned to normal.  The stock market will also experience short term anger and inflict harm to your accounts.  However, corrections are short-lived relative to the long-term rise in the market so stay the course.  The market, like the river, will eventually return to normal.
  5. The Mississippi supports life directly and indirectly. Your investments can sustain your family through capital gains, dividends and interest payments. It can also provide for those in need through charitable giving and philanthropic planning. If structured correctly, your portfolio can improve the lives of those it touches.

The Mississippi is a thing of beauty and wonder; it’s power and prestige are world renowned.   Harnessing its power while maintaining its splendor is key for it to continue to bear fruit.   Harness the power of your portfolio and it too will bear fruit!

The Mississippi River will always have its own way; no engineering skill can persuade it to do otherwise… – Mark Twain.

 but whoever drinks the water I give them will never thirst. Indeed, the water I give them will become in them a spring of water welling up to eternal life.” ~ John 4:14.

Bill Parrott is the President and CEO of Parrott Wealth Management an independent, fee-only, fiduciary financial planning and investment management firm in Austin, TX.  For more information please visit www.parrottwealth.com.

January 15, 2018

Note:  Past performance is not a guarantee of future returns.  Your returns may differ than those posted in this blog and investments aren’t guaranteed.

 

[1] https://www.nps.gov/miss/riverfacts.htm

[2] Ibid.

[3] Ibid.

[4] http://whale.wheelock.edu/watersheds/mississippi/Mississippi.html

[5] https://www.nps.gov/miss/riverfacts.htm

[6] https://weather.com/news/news/mississippi-river-flooding-december-2015, by Jon Erdman, 1/6/2016

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